This archive report was first published on 27 April 2020.
Sameer Africa Limited Plc, a company listed at the Nairobi Securities Exchange (NSE), has closed down its tyre business after more than 50 years of operation. The decision was made by the firm's board, citing failure of several strategies to improve the business.
According to a notice to the Secretary-General of the Amalgamated Union of Kenya Metal Workers, Sameer Acting Managing Director Peter Gitonga, the board held a meeting on 20th April and resolved to close down the tyre business. This decision will render the roles of employees engaged at the affected locations redundant.
The affected employees will be sent home effective 31st May 2020, with severance pay to be made. The company has been battling fierce competition from established and new tyre brands, as well as fake ones, which has made it impossible to achieve optimal stock levels.
Sameer Africa Group, established in Kenya in 1969 as Firestone East Africa Limited, has interests in agriculture, manufacturing, distribution, high-tech, construction, transport, and finance. The company recorded a loss in net earnings of KSh 182.8 Million in the half-year period ended 30th June 2019, compared to a loss of KSh 11.6 Million the previous period.
With the poor performance of its flagship tyre business, Sameer Africa is now expected to focus on leveraging earnings from its property holdings to remain afloat.
(Additional reporting by Euniah Mbabazi)
